Ethics in Economics

Ethics in Economics
Student's Name
Institution Affiliation
Instructor
Date
Ethics plays a significant role in economics. For instance, economists adopt moral values that align with judgments. The latter is essential in analyzing, predicting, and modeling financial phenomena. Essentially, ethics bolster ethical foundations and prerequisites of economic systems. According to Widerquist and Lewis (2017), ethical issues correspond with the latter positively. For example, cost-benefit analysis lets one decide by weighing expenses and benefits. One may opt to finance a political campaign or help a town develop. The two aspects are vital, but one decision outplays the other. Economic practices deter selfishness and self-interests, which are detrimental to performance and efficiency. These traits tend to refrain one from considering the impacts of decisions made on the species and relevant industry players. Ethics align individuals with determining standards that count as costs or benefits.[Cuomo, Maria Teresa, Debora Tortora, Alice Mazzucchelli, Giuseppe Festa, Angelo Di Gregorio, and Gerardino Metallo. "Impacts of Code of ethics on financial performance in the Italian listed companies of bank sector." J. Bus. Account. Financ. Perspect (2018).]
Ethics aligns economists' thinking with focusing on the will of good. For instance, one prioritizes equality, duty, and liberty. In one's economic life, the need to make ethical and moral decisions always arise. The impact of such conclusions depends on the effects created on society. For example, ethics compels organizations to evaluate market approaches and partnerships. For instance, collaborating with firms that exploit employees or running misleading or false ads are some factors corporates consider when adopting moral values. These examples highlight the role of ethics in economics and how financial decisions relate to society. James et al. (2020) view ethical economics as political. The scholars refer to the latter as the measure by within corporates and individuals allocate resources to satisfy needs. Generally, moral values help one analyze economic growth, distribution, production, trade, and consumption. Additionally, studies by Widerquist and Lewis (2017) and Tang et al. (2018) concur that ethics brings to light issues relating to international finance and trade and government policy factors such as taxation. These elements underline the profound reason why ethics matter.[Rashid, Norfadzilah, Asyraf Asfthanorhan, Razana Juhaida Johari, Nadiah Abdul Hamid, Ahmad Shukri Yazid, Fauzilah Salleh, Berhanudin Abdullah, Aida Hazlin Ismail, and Zarinah Abdul Rasit. "Ethics and Financial Reporting Assurance." International Journal of Academic Research in Business and Social Sciences 8, no. 11 (2018): 1346-1355.] [Xin, Baogui, Wei Peng, Yekyung Kwon, and Yanqin Liu. "Modeling, discretization, and hyperchaos detection of conformable derivative approach to a financial system with market confidence and ethics risk." Advances in Difference Equations 2019, no. 1 (2019): 1-14.]
Ethical economics exposes individuals and firms to benefits ranging from better relations to industrial longevity. A study by Widerquist and Lewis (2017) reveals that unethical codes of conduct hurt societies and undermine prosperity. On the flip side, the scholars contend that moral values bolster corporate social responsibility. CSR is a fundamental management strategy as it boosts competitive advantage. For example, companies with formidable morals find it easy to improve productivity, profitability, and efficiency. Consumers tend to associate with firms they trust and have ethical reputations. On the same note, institutions that prioritize the well-being of employees have a low record of lower turnover. The latter is a key profitability driver due to minimal expenditures on training and recruitment. In other words, consumers associate well with market players that have fair play, hence spending more on their products.
Corporations admire ethical practices. Therefore, it is essential to define if an economic practice is ethical. James et al. (2020) contend that before deriving an act's morality, one must follow the principles of financial practice. The scholars argue that economics elaborates on the outcome of using limited resources to address unlimited wants. Therefore, an economist must define allocation strategies for equal distribution. Such an approach stands out as efficient and inefficient as they align one to making appropriate expenditure decisions. In general, efficiency determines the fewer resources needed, while inefficiency underlines the maximum required resources.[Cuomo, Maria Teresa, Debora Tortora, Alice Mazzucchelli, Giuseppe Festa, Angelo Di Gregorio, and Gerardino Metallo. "Impacts of Code of ethics on financial performance in the Italian listed companies of bank sector." J. Bus. Account. Financ. Perspect (2018).]
Ethics in economics highlights the principles vital for survival in the financial world. Tang et al. (2018) argue that ethical principles offer a framework that bolsters decision-making. Economic systems that adhere to ethical principles enjoy fair competition. The latter is attributable to a lack of immorality...